Summer Redstone- example of competency challenge

At 92 years old, Sumner M. Redstone is currently a director, chairman emeritus, and controlling shareholder of 80% of the voting shares of Viacom and CBS. Redstone will remain in control until he either dies or is declared incompetent. During testimony in the lawsuit concerning his competency, Judge David J. Cowan stated that he was strongly considering Redstone’s motion to dismiss the case, which would leave Redstone in charge of his $42 billion media empire.

Redstone – competent to revoke agent

Manuela Herzer, Redstone’s former lover, brought the suit in Los Angeles, California to declare that Redstone was incompetent and under undue influence when he removed her from an advance healthcare directive putting her in charge of his healthcare. That same day, Redstone had also removed Herzer from his estate plan, which included gifts to Herzer of $50 million and Redstone’s $20 million mansion. If true, then Redstone’s actions removing Herzer would be invalid, as they were not truly his decisions, but the desire of someone else acting through him.

To prevail, Herzer must prove that Redstone lacked capacity or was under undue influence at the time he made the decisions to exclude her. Undue influence and lack of capacity are the two most common ways to attack a will, especially when the individual in question is elderly or infirm. Physically and mentally weakened individuals are much more vulnerable to the undue influence of those around them, especially if the weakened person depends on the person controlling them for support and care.

In North Carolina, a person is competent to make a will if he (1) comprehends the natural objects of his bounty; (2) understands the kind, nature, and extent of his property; (3) knows the manner in which he desires his act to take effect; and (4) realizes the effect his act will have upon his estate. A person challenging a will must prove that the individual who made the will failed one portion of the four-part test at the time he or she made the will.

In support of her claim of lack of capacity, Herzer offered expert testimony from Dr. Stephen L. Read, a psychiatrist who stated that Redstone suffers from dementia, struggles with swallowing, and has difficulty with “language production.” Because of this, Dr. Read gave his opinion that Redstone lacked decision-making capacity.

Herzer also claimed that Redstone has been under the undue influence of his longtime-estranged daughter Shari when he made the decision to exclude her from his healthcare decisions and estate plans. She argued that Shari “’established a broad-intelligence-gathering’ network inside Mr. Redstone’s home ‘featuring a ring of spies.’” One of Redstone’s nurses admitted to regularly providing Shari with reports on her father, including his romantic relationships, though he knew he could be fired for doing so.

Judge Cowan said that he was strongly influenced by Redstone’s impassioned videotaped testimony which indicated that Redstone did not want Herzer to make his healthcare decisions, but instead hated her and wanted her out of his life. When Redstone’s attorney asked him why he had removed Herzer from his healthcare directive, Redstone said, “She lied to me,” and also claimed that Herzer stole money from him. However, he was unable to state the amount of money he believed Herzer stole from him.

When court resumed the next Monday, Judge Cowan dismissed Herzer’s suit. The judge found that the proceeding was not reasonably necessary to protect the interests of the patient, Redstone. He specifically stated that he was not ruling on Redstone’s competency, but instead only on the issue of Redstone’s healthcare. Judge Cowan stated that Redstone’s testimony defeated Herzer’s case and was the reason she could not be restored as his agent.

Shortly after the dismissal, Herzer not only appealed Judge Cowan’s decision, but filed a new suit for undue influence. Additional suits over Redstone’s competency were filed by Redstone’s granddaughter in Massachusetts and directors of Redstone’s companies in Delaware. However, these additional competency lawsuits have settled, leaving Sumner and Shari Redstone in charge of Viacom and CBS.